Kamino Onboards JitoSOL with Double Liquid Staking Vault
Kamino Finance has onboarded a JitoSOL vault. The JitoSOL-mSOL vault pairs two liquid staking tokens, negating the dilution of staking rewards from Jito and Marinade.
Note: This article is not financial advice. Kamino Finance does not endorse any tokens or platforms mentioned in this article.
Kamino Finance is proud to announce the addition of a vault featuring the Jito Foundation’s liquid staking token, JitoSOL. The new vault will pair JitoSOL with mSOL, the liquid staking token from Marinade Finance, giving users the opportunity to optimize their staking rewards with two yield-bearing assets while earning yield from providing concentrated liquidity.
Liquidity providers can earn staking rewards, MEV rewards, and trading fees with minimal risk of impermanent loss.
The Jito Foundation Improves Network Efficiency with MEV
The Jito Foundation has become one of the most exciting additions to Solana’s arsenal of projects working to improve the network’s performance, and its liquid staking token is an exceptional example of network and capital efficiency. One of the most notable features of JitoSOL is the integration of rewards from maximum extractable value (MEV) with rewards from staking.
Jito enabled MEV rewards on Solana by forking Solana’s validator client to launch one upgraded with the ability to bundle and order transactions for advanced traders on an auction basis. These features help the entire community by reducing spam on the network and increasing rewards for staking, which are passed on to Jito-SOL holders.
While focusing on the increase of MEV on Solana, Jito has set three goals to help shape what the future of MEV on Solana will look like:
- Minimize negative externalities by reducing congestion and improving uptime
- Prevent centralization in MEV by creating low barriers to entry, healthy competition, and transparency through public data and dashboards
- Distributing rewards among the community, from regular users to validators, to ensure that a high tide raises all ships
By introducing MEV in this way, sophisticated traders, JitoSOL holders, and regular everyday users on Solana can benefit from the increased efficiency afforded by Jito’s upgraded validator client. Who doesn't like increasing staking rewards?
Pairing JitoSOL and mSOL on Kamino Maximizes Exposure to Liquid Staking
Currently, Kamino manages liquidity pools for liquid staking tokens paired with three different types of assets. These tokens are either paired with their underlying asset, such as stSOL-SOL, paired with another volatile token, such as mSOL-ETH, or paired with a stablecoin, as with stSOL-USDC.
Kamino’s first JitoSOL vault pairs the token with mSOL, marking the first time two liquid staking tokens have been paired as Kamino managed liquidity. This is a huge deal for users who would like to maintain as much exposure to their liquid staking tokens as possible to earn yield from staking along with their yield from fees earned from trading activity.
For example, even with highly correlated pairs like stSOL-SOL, as stSOL grows in value to reflect rewards earned from staking, the liquidity position slowly trades out stSOL for more SOL.
However, with JitoSOL-mSOL, both tokens not only move together along with the price action of SOL, but they also increase in value at similar rates, and no matter which token increases in value faster, the position is always 100% earning yield from staking.
Kamino and Jito Work to Bring Net Positives to Users
Progress and optimization come in small and incremental steps. Both Kamino and Jito are working at the protocol level to ensure that Solana becomes one of the most dominant blockchains in the world, and the work each project puts toward this goal doubles in value through teamwork and composability.
Kamino Finance is on a mission to make concentrated liquidity as efficient as possible for users seeking yield and traders looking for the deepest and most capital-efficient swaps.
Jito is also on a similar mission to improve the efficiency of the network for traders who discover optimal trade opportunities with the aid of MEV and the entire Solana ecosystem that depends on a diverse network of validators receiving staked SOL.
Combine these missions, and there is nothing but net-positive outcomes for the Solana ecosystem and its users.